Home GBP/USD: Trading the UK Claimant Count Change

GBP/USD: Trading the UK Claimant Count Change

The UK Claimant Count Change measures the change in the number of people claiming unemployment benefits. It provides a snapshot of the UK employment situation and  could affect the direction of  GDP/USD.    

Here are the details and 5 possible outcomes for GBP/USD

Published on Wednesday at 9:30 GMT.

Indicator Background

UK Claimant Count Change is closely monitored, as the indicator is one of the most important economic indicators. A reading which is lower than the market forecast is bullish for the pound.

The indicator sparkled in January, as jobless rolls dropped by 42.4 thousand. This crushed the estimate of a gain of 1.1 thousand. Another small gain is expected in February, with an estimate of 3.1 thousand.

Sentiment and Levels

The markets have priced in a Fed rate hike on Wednesday, but the move should still reinvigorate the markets and push up the US dollar. With the Bank of England maintaining a neutral policy regarding rate movement, monetary divergence continues to favor the greenback. So, the overall sentiment is bearish on GBP/USD towards this release.

Technical levels from top to bottom: 1.2511, 1.2385, 1.2218, 1.2080. 1.1943 and 1.1844

5 Scenarios

  1. Within expectations: -1.0K to +7.0K: In this scenario, GBP/USD could show some slight movement, but it is likely to remain within range, not breaking any levels.
  2. Above expectations: 7.1K to 11.0K: A weak reading could push the pair below one support level.
  3. Well above expectations: Above 11.0K: In this scenario, the pair could break below two support lines.
  4. Below expectations: -5.0K to -1.1K: A lower reading than expected could push GBP/USD upwards, with one resistance line at risk.
  5. Well below expectations: Below 5.0K: A significant drop in jobless claims could result in GBP/USD pushing above two resistance lines.

For more on the pound, see the GBP/USD forecast.

Kenny Fisher

Kenny Fisher

Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.